Group 1 - The company's domestic business is progressing steadily, while its international subsidiary Lombard is expected to turn profitable this year. The improvement in profitability is attributed to enhanced production efficiency and a domestic raw material utilization rate exceeding 85%, leading to an anticipated overall gross margin recovery to over 70% for the year [4]. - In Q3 2025, the company's revenue grew by 64.68% year-on-year, primarily due to a low base effect from the previous year when major products were impacted by price governance. However, profit declined year-on-year mainly due to product price adjustments. The overseas business has become a significant growth engine, with revenue growth exceeding 65% in the first three quarters, now accounting for 18% of total revenue, and the overall gross margin for overseas operations has improved to 50% [4]. Group 2 - The company is continuously optimizing its R&D investment structure to enhance the R&D output ratio. Significant progress has been made across various product pipelines, providing momentum for medium to long-term development. The Hector thoracic aortic multi-branch stent system successfully completed the first pre-market clinical implantation in November. Other products, such as the Aegis II abdominal aortic stent system and IBD iliac branch stent, are progressing as planned. Key peripheral products are expected to receive approval for market launch within the next year [5].

Investment Rating - The report maintains a "No Rating" status for the company [5] Core Insights - Domestic business is progressing steadily while international business is experiencing rapid growth. The subsidiary Lombard is expected to turn profitable this year. The company's gross margin is anticipated to recover to over 70% for the year, driven by improved production efficiency and a domestic raw material utilization rate exceeding 85% [1] - In Q3 2025, revenue grew by 64.68% year-on-year, primarily due to a low base effect from the previous year. However, profit declined year-on-year mainly due to product price adjustments. The overseas business has become a significant growth driver, with revenue growth exceeding 65% in the first three quarters, accounting for 18% of total revenue, and an overall gross margin of 50% for international operations [1] - The R&D pipeline is progressing steadily, with several key products expected to be launched soon. The Hector thoracic aortic multi-branch stent system has successfully completed its first clinical implantation in November, and other products are on track for approval within the next year [2] Financial Forecasts and Valuation - The company is a leader in the domestic aortic and peripheral intervention fields. Revenue in Q3 2025 achieved high growth from a low base, with ongoing expansion in overseas and peripheral businesses. The net profit forecasts for 2025 and 2026 have been adjusted downwards to 633 million and 705 million yuan respectively, with a new forecast for 2027 at 848 million yuan. The net profit growth rates for 2025 to 2027 are projected at 26.0%, 11.4%, and 20.3% respectively. The current stock price corresponds to a PE ratio of approximately 16 times for 2026 [3][4]

Investment Rating - Maintain Outperform rating with a target price of RMB 122.06, reflecting a target PE of 25X for 2025 [4][12]. Core Insights - The company faced short-term pressure on performance due to aortic stent price adjustments, but its competitive edge in the aortic field remains strong, with ongoing expansion in peripheral and tumor intervention sectors [1][4]. - Revenue for the first three quarters of 2025 reached RMB 1.02 billion, with a net profit attributable to shareholders of RMB 429 million, marking a 60% year-over-year increase in net profit after excluding government subsidies and other investment income [4][12]. - The company has established a significant domestic market presence, with products entering nearly 2900 hospitals across 31 provinces and regions, maintaining a leading market share in aortic intervention products [4][12]. Financial Summary - Total revenue projections show a growth trajectory from RMB 1,187 million in 2023 to RMB 2,257 million by 2027, with a compound annual growth rate (CAGR) of approximately 22.3% [3][5]. - Net profit attributable to shareholders is expected to increase from RMB 492 million in 2023 to RMB 915 million in 2027, reflecting a CAGR of about 21.4% [3][5]. - The gross profit margin (GPM) is projected to recover, with Q3 2025 GPM at 73.28% and net profit margin (NPM) at 37.44%, driven by improved production efficiency and reduced material costs [4][12].